Financial Contrast: Eldorado Resorts (ERI) and Melco Crown Entertainment Limited (MLCO)
Eldorado Resorts (NASDAQ: ERI) and Melco Crown Entertainment Limited (NASDAQ:MLCO) are both consumer discretionary companies, but which is the superior stock? We will compare the two businesses based on the strength of their valuation, institutional ownership, analyst recommendations, profitability, dividends, risk and earnings.
This is a breakdown of current ratings and price targets for Eldorado Resorts and Melco Crown Entertainment Limited, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Melco Crown Entertainment Limited||0||5||9||0||2.64|
Eldorado Resorts presently has a consensus target price of $25.00, suggesting a potential upside of 9.17%. Melco Crown Entertainment Limited has a consensus target price of $21.42, suggesting a potential upside of 4.94%. Given Eldorado Resorts’ stronger consensus rating and higher probable upside, equities research analysts clearly believe Eldorado Resorts is more favorable than Melco Crown Entertainment Limited.
Valuation & Earnings
This table compares Eldorado Resorts and Melco Crown Entertainment Limited’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Melco Crown Entertainment Limited||$4.92 billion||2.03||$1.11 billion||$0.52||39.25|
Melco Crown Entertainment Limited has higher revenue and earnings than Eldorado Resorts. Eldorado Resorts is trading at a lower price-to-earnings ratio than Melco Crown Entertainment Limited, indicating that it is currently the more affordable of the two stocks.
Melco Crown Entertainment Limited pays an annual dividend of $0.30 per share and has a dividend yield of 1.5%. Eldorado Resorts does not pay a dividend. Melco Crown Entertainment Limited pays out 57.7% of its earnings in the form of a dividend.
Volatility & Risk
Eldorado Resorts has a beta of 0.99, suggesting that its stock price is 1% less volatile than the S&P 500. Comparatively, Melco Crown Entertainment Limited has a beta of 1.91, suggesting that its stock price is 91% more volatile than the S&P 500.
This table compares Eldorado Resorts and Melco Crown Entertainment Limited’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Melco Crown Entertainment Limited||5.11%||9.20%||3.59%|
Insider and Institutional Ownership
69.4% of Eldorado Resorts shares are held by institutional investors. Comparatively, 39.8% of Melco Crown Entertainment Limited shares are held by institutional investors. 1.1% of Eldorado Resorts shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
Melco Crown Entertainment Limited beats Eldorado Resorts on 8 of the 13 factors compared between the two stocks.
Eldorado Resorts Company Profile
Eldorado Resorts, Inc. is a gaming and hospitality company that owns and operates gaming facilities located in Ohio, Louisiana, Nevada, Pennsylvania and West Virginia. The Company’s segments are Nevada, Louisiana, Eastern and Corporate. As of May 1, 2017, the Company owned and operated approximately 503,000 square feet of casino space with approximately 20,000 slot machines and video lottery terminals (VLTs), over 550 table and poker games, 45 restaurants and 6,500 hotel rooms. As of December 31, 2016, the Company owned and operated various properties, including Eldorado Resort Casino Reno (Eldorado Reno), Silver Legacy Resort Casino (Silver Legacy), Circus Circus Reno (Circus Reno), Eldorado Resort Casino Shreveport (Eldorado Shreveport), Mountaineer Casino, Racetrack & Resort (Mountaineer), Presque Isle Downs & Casino (Presque Isle Downs), and Eldorado Gaming Scioto Downs (Scioto Downs).
Melco Crown Entertainment Limited Company Profile
Melco Resorts & Entertainment Limited, formerly Melco Crown Entertainment Limited, is a holding company. The Company, through its subsidiaries, develops, owns and operates casino gaming and entertainment casino resort facilities in Asia. It is principally engaged in the gaming and hospitality business in Asia and its principal operating and developmental activities occur in over two geographic areas, which include Macau and the Philippines. Its segments include City of Dreams, Altira Macau, Studio City, Mocha Clubs, City of Dreams Manila, and Corporate and Others. It has over three casino based operations in Macau, namely, City of Dreams, Altira Macau and Studio City, and non-casino based operations in Macau at its Mocha Clubs. It also has a casino based operation in the Philippines, City of Dreams Manila. It is developing the fifth hotel tower at City of Dreams in Cotai, Macau. Its other operations also include Taipa Square Casino, Macau operating within Hotel Taipa Square.
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